Central Bank Watch
Malaysia Gets First Central Bank Rate Hike since May 2011
July 10, 2014
Like the rate increases engineered in March, May and July 2010 plus that in May 2011, today’s tightening was an increment of 25 basis points and lifts the interest rate to 3.25%. That’s only on a par with the latest 3.2% on-year inflation rate and leaves policy growth-supportive (that is accommodative) according to a released […] More
Central Bank Watch
Bank Indonesia
July 10, 2014
A more restrictive monetary policy in Indonesia addresses three problems in particular: above-target inflation of 6.7% (the target is 3.5-4.5%), a current account deficit roughly equal to 3.5% of GDP, and a vulnerable rupiah, whose deceleration picked up pace last month. From a low of 5.75%, the BI central bank interest rate was lifted by […] More
Central Bank Watch
Bank of Korea
July 10, 2014
The seven-day repo rate has been at 2.5% since cuts of 25 basis points in November 2012 and May 2013. 2.5% remains above the current 1.7% 12-month rate of inflation. The latest policy statement continues the dovish tone, revises projected growth and inflation in 2014 and 2015 downward, predicts a moderately paced narrowing of the […] More
Central Bank Watch
National Bank of Serbia
July 10, 2014
Although the policy interest rate was left unchanged at 8.5%, a mostly dovish statement was released that projected inflation hovering near the bottom of the target range, observed a stable exchange rate, and spoke of a bleaker growth prognosis in part related to the impact of flooding. The key central bank rate had been reduced […] More
Central Bank Watch
Nothing of Significance Said in Bank of England MPC Statement
July 10, 2014
The monthly Monetary Policy Committee review of policy resulted in the expected decision not to change the 0.5% Bank Rate of the GBP 375 billion ceiling associated with the quantitative asset purchase program. That limit was reached by early November 2012. The released statement said minutes would be published July 23, a fact that already […] More
New Overnight Developments Abroad - Daily Update
Return to Risk-Off Market Psychology
July 10, 2014
European equities and bond prices were sold off pretty hard. The yen has firmed. Gold spiked higher, and oil continues to slide. The catalyst for this fresh wave of risk aversion was the failure of the parent company of Portugals Espirito Santo Financial to make a debt payment, but there are other causes, one being […] More
